Input: Federal grant dollars on the rise

Federal grants to state and local governments are expected to increase substantially over the next three years, hitting more than $440 billion by fiscal 2006, according to a report by the market research firm Input Inc., Reston, Va.

"With deficits mounting and the cost of delivering services to citizens on the rise, states and localities are in a position of budget crises," said Meredith Luttner, Input's manager of state and local market development services. "State and local governments are relying on federal grants to fund technology procurements and to move programs and projects forward."

Input's report, released this week, shows overall federal grant funding to state and local governments rising by nearly $56 billion between fiscal 2003 and 2006.

The firm analyzed the changes in federal allocations in 14 categories over the next three years. Most of the additional outlays are in the health arena, which is expected to increase to more than $49 billion.

The next-largest dollar value increase is in the income security or public assistance program area, which will increase by $4.2 billion. Community and regional development, which will drop by $3.7 billion, is losing the most in grant funding.

"Vendors that educate themselves about the federal grants process and current grants activity can reap great benefits," Luttner said. "Not only can vendors follow the flow of grant awards to state and local governments, but they can also provide an added award service to their potential government customers by making them aware of new grant program funding sources."